Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/122189
Authors: 
Hübler, Michael
Schenker, Oliver
Fischer, Carolyn
Year of Publication: 
2015
Series/Report no.: 
ZEW Discussion Papers 15-079
Abstract: 
This paper studies policy instruments that correct insufficient learning-by-doing (LbD) and research and development (R&D) of renewable electricity technologies and insufficient investments in energy efficiency (EE) in the presence of carbon pricing. The theoretical model analysis shows how to re-adjust the first-best in second-best situations, in which one of the policy instruments is restricted. Calibrated to the European power sector, the first-best choice of all instruments reduces the climate policy cost by one third. Feed-in tariffs turn out to be good substitutes for LbD, but not for R&D or EE subsidies.
Subjects: 
second-best
climate policy
energy policy
feed-in tariff
power sector
EU
JEL: 
C61
O33
Q48
Q54
Q55
Document Type: 
Working Paper

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